IEA net-zero scenario “totally unrealistic”: Novatek deputy chairman
The International Energy Agency (IEA)’s recent conclusion that no further investment in oil and natural gas is needed in a scenario where the world achieves net-zero emissions by 2050 is “totally unrealistic,” Novatek deputy chairman Mark Gyetvay tells NGW in the In a Nutshell podcast.
“This is not reality, there’s no way that we can continue with a growth of 2bn people by 2050, more than double economic activity, and have electricity that is 90% renewables,” the head of finance at Russia’s largest independent gas producer said.
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The IEA’s conclusion fails to account for regional differences in energy mixes and economic growth paths, he said, noting the environmental benefits of replacing coal with natural gas in power generation.
“To raise the standard of living, and increase economic prosperity, you’re going to need more energy,” the deputy chairman continued, adding that Novatek's solution for decarbonisation was to “produce more gas, not less.”
Novatek is looking to ramp up its liquefaction capacity to 70mn metric tons/year by 2030, establishing Russia as a major player in the global market for LNG. Gas has a key role to play in the future energy mix alongside renewables and hydrogen, Gyetvay said.
“There needs to be an honest debate,” he said. “To say that no new investments [in oil and gas] are needed post 2021 is a totally ridiculous comment. It does not lead to an energy transition, but instead, an energy crisis.”
Gyetvay said he supported the net-zero 2050 goal. But individual companies’ emissions targets for the middle of the century are only “aspirational” in nature, he said. Novatek's own climate objectives only run until 2030.
“Many of these 2050 goals are purely aspirational because they don’t have concrete steps in place today to get to them,” he said.
Novatek is considering a range of low-carbon technologies to decarbonise its LNG facilities in the Russian Arctic, including the use of wind and hydrogen as energy sources, as well as carbon capture and storage. It is also studying a plan to export clean fuels ammonia and methanol, Gyetvay said.
The climate conversation needs to shift from looking only at CO2 to looking at all greenhouse gas emissions including methane, the deputy chairman continued. Novatek’s own methane emissions from production, processing and LNG were 10.44 metric tons/mn barrels of oil equivalent in 2019, which it describes as one of the lowest intensities in the industry. It aims to reduce this number by a further 4% by 2030.